contestada

The failure to properly record an adjusting entry to accrue an expense will result in an
a. overstatement of expenses and understatement of liabilities
b. understatement of expenses and overstatement of liabilities
c. understatement of net income and understatement of liabilities
d. overstatement of net income and understatement of liabilities
e. understatement of expenses and overstatement of assets

Respuesta :

mltn1980

Answer:

d. overstatement of net income and understatement of liabilities

Explanation:

When the company fail in adjusting an accrue expenses it's overstating the Net Income because is not recognizing an expense that happenned and is underestimating the liabilities, with the entry it's recognizig that the company incurred in expenses, in other way the expenses are not recognizing during the current year.

When the adjusting entry is not recorded for accruing an expense so here option d is correct.

Net income & liabilities:

In the case when the company fail for passing an adjusting for accrue expenses so it overstated the Net Income since the expense is not recorded due to this the assets should be increased so this represent the overstatement of assets.

learn more about an expense here: https://brainly.com/question/24543809

Otras preguntas